contestada

Company owns a tract of land which it purchased in 2006 for $100,000. The land is held as a future plant site and has a fair market value of $140,000 on July 1, 2009. Hall Company also owns a tract of land held as a future plant site. Hall paid $180,000 for the land in 2008 and the land has a fair market value of $200,000 on July 1, 2009. On this date Madden exchanged its land and paid $60,000 cash for the land owned by Hall. If the exchange has commercial substance, at what value Madden record the land acquired in the exchange?

Respuesta :

Answer:

$200,000

Explanation:

The computation is shown below:

Given that

Purchase value of tract of land in 2006 = $100,000

Fair market value = $140,000

Paid amount = $180,000

Fair market value = $200,000

Cash paid = $60,000

So by considering the above information, the land should be recorded at

= Fair market + Cash paid

= $140,000 + $60,000

= $200,000

Otras preguntas